Bosses of small companies take 15pc pay cut

Directors of the UK’s largest listed companies may have watched their pay
packages surge ahead of those of their staff, but it’s a rather different
picture for the majority of British bosses, research has revealed.

While FTSE 100 directors enjoyed pay rises of almost 50pc last year, the total pay package for directors of companies with sales of less than £5m has fallen by 15pc in the last 12 months, to £82,500, according to a survey of 3,200 bosses.

The research, conducted by HR consultancy Croner, also found that pay for directors of these small companies has fallen by £5,000 compared to five years ago.

Vivienne Copeland, head of reward at Croner, said: “Despite recent reports that FTSE 100 bosses have seen a 49pc increase in their pay, this is not the case for the majority of directors in British boardrooms.

“The financial position of people running small businesses is a far cry from their much larger corporate counterparts.”

The heads of companies with sales of between £5m and £50m fared slightly better, seeing a modest average pay increase of 3pc, taking their total pay package to £128, 699. Even directors of larger businesses, with revenues of between £50m and £500m, enjoyed a similarly muted pay rise, with an increase of 2pc compared to last year, to £174, 287.

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Croner also found that most entrepreneurs are having to work harder – 36pc of respondents said they are working more than 50 hours a week, and around one in four said they are clocking up more than 55 hours each week. The research also found bosses were taking fewer holidays.

Ms Copeland added: “If you take into account the fact that over a quarter of directors have had a pay freeze, work longer hours, taken fewer holidays and seen their retirement age rise, many directors are facing the same kinds of setbacks in terms of reward as the bulk of the UK workforce.”

The overall average pay rise for the 73pc of directors who received one was 3pc, Croner said. Official figures show that the average workers’ salary rose by just 1.4pc in the year to April.

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